Interleukin-1( (IL-1) has been implicated as an effector molecule of (-cell destruction in autoimmune diabetes. IL-1 inhibits insulin secretion from pancreatic (-cells by stimulating the expression of inducible nitic oxice synthase (iNOS) that generates nitric oxide. IL-1 also induces co-expression of the inducible isoform of cyclooxygenase (COX-2) and overproduction of proinflammatory prostaglandins and their precursor arachidonic acid, as demonstrated by isotope dilution mass spectrometry. The current studies characterize the involvement of protease(s) in the signaling pathway of IL-1-induced iNOS and COX-2 expression. Biochemical and molecular studies were performed using the rat insulinoma (-cell line, RINm5F. A serine protease inhibitor, N(-p-tosyl-L-lysine chloromethyl ketone (TLCK) and a proteasome complex (26S) inhibitor, MG 132, inhibited Il-1-induced nitrite formation, an oxidation product of nitric oxide produced by iNOS, in a concentration-dependen t manner. Both TLCK and MG 132 also inhibited iNOS gene expression at the level of mRNA and protein. TLCK and MG 132 also inhibited IL-1 induced COX-2 enzyme activity (PGE2 formation) and COX-2 gene expression at the level of mRNA and protein. In human islets, the proteasome inhibitor, MG 132, also inhibited the formation of the products of iNOS and COX-2 enzyme activity, nitrite and PGE2 respectively. These findings suggested that the inhibitory action of TLCK and MG 132 on iNOS and COX-2 expression precedes transcription. The transcription factor, NF(B, is essential for activation of a number of cytokine-inducible enzymes and was evaluated as a possible site of protease action necessary for IL-1 induced co-expression of iNOS and COX-2. TLCK and MG 132 inhibited both IL-1 induced activation of NF(B and degradatin of 1(B( by islets and RINm5F cells. These results implicate protease activation as an early signaling event in IL-1-induced inhibition of (-cell function.